6/8/19

Second Place: "Tinka (TK.v) clears the decks". A small and ultimately unimportant observation that got plenty of hits for some strange reason. Part of the never-ending mystery of what does and does not get popular on the blog..

6/6/19

Toronto, Ontario, June 6, 2019 – Lydian International Limited (TSX:LYD) (“Lydian” or the “Company”) announced today the following management update.

As part of the Company’s restructuring program, Joao Carrelo, President and Chief Executive Officer and a member of the board of directors, will step down effective June 12, 2019. Russell Ball, Chairman of Lydian, commented on behalf of the board, “We thank Joao for his leadership over the past year and we are pleased he has agreed to continue to assist the Company on a consulting basis going forward. We wish him well with his future opportunities.”

Lydian also announced that the board of directors has appointed Edward Sellers, a current member of the board of directors, as Interim President and Chief Executive Officer, effective June 12, 2019.

You don't need my words, you need theirs. Well worth reading all of this, so find the link here. Some extracts:

For veterans who had returned to Normandy, seeing the beaches and the
quiet villages, now household names, that they fought their way through
in France, is still overwhelming. Memories were of running for the
dunes, bullets bouncing, shells screaming, beaches vibrating as the
allied naval guns pounded German targets to provide cover for those
going in.

The cemeteries are particularly emotional. “You think to yourself,
all them lying there, why aren’t I one of them? Because I were with
them,” says Ray Mellors, 94, from Nottingham, who as an 18-year-old with
the South Staffordshire Regiment, had waded through the sea, “in the
dark and wet”, towards Sword beach shortly after D-day.

“It’s haunted me for the rest of my life. I sit here now, and I think to
myself ‘I shouldn’t be here, really. I should be under the ground where
the others are’.”

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“There was a lot going on,” says John Eden, 94, from Silverdale,
Morecambe Bay, who as a 19-year-old private in the 12th (Airborne)
Battalion of the Devonshire Regiment landed the day after D-day. “This
brings back feelings you don’t really want to feel.”

He says: “Don’t forget, I was a terrified little lad.”

He could not explain why he had been drawn back. “What can you say? I
had four years in the army, and this was part of it, an experience that
you can’t comprehend, can you? You can’t imagine how you did it”. At
Ranville war cemetery, he planned to visit “two particular graves” for
fallen comrades.

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Revisiting the small villages, Douglas Russell, 97, who lives in
Morecambe, was surprised at the warm welcome. “All the people that have
turned up, people shaking my hand. It’s nice. But I’m not a hero, just
an ordinary chap.”

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This was the second time he had returned to Normandy. He had never
wanted to come back before. “It’s unfortunately part of your life, and
when the war finished, all I wanted to do was get back to my wife, and
rear a family, and forget it,” says Anderson, from Manchester, who went
on to work for an advertising agency.

Visiting the cemeteries would be hard, he says. “I know I am not
going to like it when we get to Omaha and see the American cemetery.
Those numbers of graves are just too much.”

Remember that U$690m deal reached by Vale to sell a large proportion of its Voisey's Bay cobalt to the combination of Wheaton Stuff & Things (WPM) and Cobalt27 (KBLT.v)? It's now a year (minus two days) since that deal was announced to the world, using phraseology such as this from the CEO of KBLT.v:

"We expect a stream on this world-class, low-cost, long-life asset to be
rewarded in the market and build the foundation for a value re-rating of
our Company's shares."

So how's that re-rating going?

Got a thought on that, Owly?

Yup, me too. Since that deal KBLT has dropped by a cool 70%, but at least KBLT has had the upfront decency to admit its FUBAR and impair its holding in the stream. Here's a quote from its latest quarterly filings:

ImpairmentBased on an updated outlook on long-term cobalt prices, the Company re-evaluated the carrying value of its stream investment. As a result of this review, the Company recorded, during the three months ended March 31, 2019, an impairment charge of $68,892,638. The recoverable amount of $235 million was determined using a discounted cash flow model in estimating the fair value.

Not so Randy Smallwood and Wheaton, which did not place any sort of impairment on its U$390m purchase that has gone so horribly wrong in the space of one year. I mean, check this five year chart and realize that cobalt was trading at U$40/lb when Randy pressed the big green button on this deal. That's a decision which has cost the shareholders of WPM over U$90m in money-straight-down-toiletness. Smallwood will, however, collect his fat annual bonus cheque for being brilliant.

Still think INV Metals (INV.to) at Loma Larga or the Chinese capital Rio Blanco project close by have a chance of happening, despite that local referendum in the Girón canton that went 87% against mining? Allow your humble scribe to do a little translation for you. From this report in Ecuador's national daily paper, La Hora:

Yaku Pérez, prefect of Azuay, announced that in the first session of the Provincial Council due to sit in the next 15 days, a petition will be presented to request a "Popular Consultancy" (referendum) to "prohibit mining at water sources not just in a municipality, but over the whole of the province of Azuay."

After approval from the local council, the proposal goes to the Constitutional Court and the CNE (National Electoral Council). "By the ned of this month we could be calling on the citizens (of Azuay) to vote", he added.

He also said that, "In fact our position is categorical; At water sources, páramos, marshes and areas of water displacement, no type of minn. Not small, not medium, not mega, neither formal or informal."

6/5/19

Further to the IKN post on Belo Sun (BSX.to) yesterday that outlines the way in which the band of Forbes&Manhattan cronies are sewing the company up for their own benefit, your humble scribe received most interesting mails from a number of people and I thank you all for those. One of those has kindly allowed me to share this segment of his mail (some very slight editing to protect both guilty and innocent, the message 100% unchanged). Yet another example of how the Stan Bharti clan makes sure it gets rich at the expense of the people foolish enough to trust them with their shareholders dollars. We invite you to read on and consider the words of a very experienced mining executive:

Many us in the mining industry
are very aware of the egregious cross relationships with Forbes &
Manhattan but oddly enough, it seems to
escape the notice of the proxy advisors and regulators. The
key one regarding BSX is Troilus Gold (TLG.to), another
Forbes & Manhattan company. BSX bought and sold shares in the
company in
the March quarter of 2019 as disclosed in the MDA. There is no apparent
justifiable reason (from a shareholder perspective, but who cares about them?) why a
company
trying to permit a project in Brazil would trade in the shares of
company with
a gold/copper project in Quebec, but back office data show there are multiple relationship reasons
for this seemingly
odd use of funds:

Peter Tagliamonte (BSX President & CEO) is an executive
director of Troilus (he received total compensation of $510,541 in 2018 from Troilus and would
receive $920,000 in a change of control).

Ian Pritchard (BSX COO) is VP Technical Services of Troilus.

Denis Arsenault an "independent director" of BSX (but
stepping down at the BSX 2019 AGM) is the CFO of Troilus.

Bruce Humphrey an "independent director" of BSX is also a director
of Troilus.

We place the words "independent director" firmly between inverted commas for good reasons; Of the four "independent" directors currently
on the BSX board, which include Denis Arsenault, Carol Fries, Bill
Clarke and Bruce
Humphrey only Carol Fries does not sit on a Forbes & Manhattan
company
board. But she is
Chair of the Corporate Governance Committee and the oversight in this
area
seems very light. Unfortunately, the new
proposed nominee to the BSX board Sergio Marchi also sits on another
Forbes
& Manhattan company board so the pattern of crony directors and
management continues.

BUENOS AIRES (Reuters) - Argentina’s Supreme Court on Tuesday shot
down a challenge to an environmental law banning mining in glacial areas
that had been brought by Canadian miner Barrick Gold.

“The challenge posed by Barrick is ruled inadmissible,” according to the ruling. Continues here

Two weekends ago in IKN522 dated May 26th, subscribers to The IKN Weekly read this:

Argentina: Eyes on the Glacier Law

This report (12)from Argentina’s biggest circulation
daily, Clarín, provided an update of the process of the appeal against the
so-called “Glacier Law” and notes that at least three and probably four of the
five judges sitting at the country’s highest court of law have apparently made
their preliminary decision on whether to uphold the constitutionality of the
law. According to sources quoted by the journalist, the preliminary decisions
of the judges are to accept the law as stands as constitutional and with just
one (or two) judges left to opine, we’re now likely to get a decision before
the court goes into recess in July.

The appeal against the law has been
going on since 2011 and while complicated (these things are never black and
white), the bottom line is that if the Supreme Court upholds the law as
constitutional, it will adversely affect up to 40 mining operations and
projects located in the high Andean regions of Argentina, along the country
border with Chile. If upheld and depending on the project, the law would be
something between a headache and a full-on project killer.

Seriously, just avoid this country.

Further questions?

PS: By the way subbers, the update in IKN523 last Sunday is probably more important as that translated op-ed got it exactly right.

6/4/19

To understate the obvious, Stan Bharti and his cronies at Forbes & Manhattan have previous form when it comes to playing heads-I-win-tails-you-lose with shareholders and bleeding their companies' structures for everything they're worth. Time and again they have ignored their fiduciary duties and made sure all the benefits of any deal go first and foremost to the cozy band of inner circle directors and this week, thanks to their latest sneaky backdoor maneuver, we have a new one to highlight.

Yesterday Monday, Belo Sun (BSX.to) filed its 2019 Management Information Circular (MIC) to SEDAR in anticipation of the company's upcoming AGM (go over to the site and download yours) and sure enough buried deep among its 144 pages is a delightful new piece of legalized white collar crime designed to apply liberal quantities of KY Jelly to the soft plump cheeks of BSX shareholders. Around pages 21 to 24 you can read how BSX
has increased The Termination Not For Cause up to 8x from the 2018 MIC. All the Named Executive Officers (NEOs) except the COO, as well as its Forbes & Manhattan "service providers" (i.e. siphoning off company capital to Stan's back pocket) would receive 24 months of fees in the event
of termination not for cause if the MIC is voted up in the AGM. As "termination not for cause" is the euphemism for "getting fired for being crap at your job", it means the BSX Compensation Committee, which includes
two directors that are stepping down at the 2019 AGM, decided to protect
the NEOs from any sort of poor performance....in the best
interests of BSX shareholders.

But wait! There's more! BSX is also hoodwinking its shareholders into approving a new "Change of Control" payout by adding in this clause: "a
change of control of the Board resulting from the election of less than a
majority of the persons nominated for election by management of the
Corporation”. That may sound a little bland at first but frankly it's scandalous, because with this they essentially ensure that if they continue to do
the very poor job they have been doing, fail to not advance permitting
at Volta Grande and get terminated not for cause...they still win! Come the day that shareholders try to improve the company by
replacing the majority of these self-serving excuses of directors, the people they boot out get an massive financial win of 36
months of fees, bonuses and all types of et cetera. So to sum up:

The BSX cronies get paid a crazy amount of money in the first place.

For at least five years (and arguably longer) they have done nothing to move their project forward, but still cut themselves fat cheques.

But now, if they are fired for doing a bad job they get fat bonuses

And even if the shareholders of the company (i.e. the real owners) boot them out, this is now considered a "change of control" event and they still get an obscene payola.

And they wonder why the junior mining sector fails to attract investment capital these days...

You can time them with a stopwatch, the BS end of the junior mining world will always manage to find something to say about themselves on the day after a big move in gold. Yesterday we bust through U$1,300/oz and finish solidly in the 1320's, and today...

A trifling sample of what's out there this morning, reams of NRs stuffed with absolutely nothing, dozens of companies shouting "LOOK AT ME!" and waving their arms above their heads, far corner of a crowded room. Anyway, I thank these companies, their CEOs and IR departments for marking my card about them. The more filters that allow me to discard the bullshitters and concentrate my time on the companies worth investigating, the better.

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